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JEREMIE is welcome but where is JESSICA?

December 17, 2009 3:12 PM

Lib Dem parliamentary spokesman for Newcastle East Greg Stone has welcomed news that the European Investment Bank and One North East are to collaborate to establish a venture capital fund designed to support the region's small businesses access funds to support business growth and employment.

The JEREMIE scheme is the first of its kind in the UK but is also operating on a similar basis in other EU regions and will form a £125m loan fund to pump finance into business start-ups, technology businesses, and to support existing business and employment growth. It is hoped the new funding could help to create over 5000 jobs.

However, the region has not yet benefited from the EU's JESSICA fund, which would provide similar capital funding support to stimulate sustainable development and regeneration in urban areas.

Greg Stone said "The joined up approach offered by JEREMIE whereby ONE and the European Investment Bank are pooling resources to maximise impact is a sound one. The North East has historically had a low business start-up rate and has not been great at enabling high rates of growth for successful businesses. Greater access to venture capital, particularly at a time when the banks are not creating sufficient lending capacity, is a positive step to tackle this.

"However, I am somewhat concerned that the sister EU programme JESSICA, which provides funding to pump-prime major urban development projects, is not yet on stream in the North East. JESSICA could help to stimulate development and jobs on crucial Newcastle / Gateshead projects like Science Central, the Ouseburn Valley, or the proposed Quayside conference centre by providing a financial vehicle to fund the initial development cost and pay for it from the subsequent returns. I'd like to see North East agencies implementing both JEREMIE and JESSICA to support the economic regeneration of our area."